Site C and NAWAPA

"Exactly the right place" for long-term continental water-sharing plans

Joyce Nelson

March 14, 2017

Photo courtesy of DeSmog Canada

In her book Beyond Banksters: Resisting the New Feudalism, Joyce Nelson devotes a chapter to the looming issue of bulk water exports. Here she provides an update, given the election of Donald Trump and the possible re-negotiation of NAFTA.

For years, scientists have been telling Californians that increased groundwater pumping for farmland irrigation is rapidly depleting the aquifers and is simply not sustainable. Even now, as the rains return to northern California, the problem of disappearing groundwater in the southern part of the state continues, and largely because of an industry based on an early 20th century premise of “making the desert bloom.”

While campaigning in California last May, Donald Trump told the crowd of cheering supporters, “There is no drought” – a stunning claim that invited his listeners to deny their own lived experience. Since 2011, drought in California, Texas, and much of the southwest have led to draconian crackdowns on everything from lawn-watering to car-washing to water-hoarding.

“You have a water problem that is so insane,” Trump said. “It is so ridiculous where they are taking the water and shoving it out to sea … If I win, believe me, we’re going to start opening up the water.”

Trump’s pick for Secretary of State, Rex Tillerson, as Chair and CEO of ExxonMobil, told the US Council on Foreign Relations (June 27, 2012), “There is plenty of water. It’s just not in all the right places,” calling it “a water distribution problem.”

Site C

Making water available to “the right places” has been the dream of megaproject promoters of bulk water export ever since the 1950s, when the US Army Corps of Engineers mapped Canada’s freshwater resources in fulfillment of their government mandate to make sure America would never run out of water.

According to BC agronomist Wendy Holm, Site C “is exactly where it needs to be to deliver continental water-sharing plans” like NAWAPA, the North American Water and Power Alliance. The highly controversial BC Hydro Site C dam project will create an 83-kilometre-long reservoir in the Peace River Valley, which is already the site of two previously-built dams.

Now that the Prophet River and West Moberly First Nations have lost their Federal Appeal Court treaty challenge to Site C, there is little in the way of the $9 billion project.

The NAWAPA “water-sharing” plan, unveiled in 1964 by the California-based Ralph M. Parsons Company (now called Parsons Corporation), was based on those Army Corps maps, and taken to a new level of engineering grandiosity. NAWAPA would divert water from the Yukon, Laird, Fraser, Peace and Columbia Rivers for use in Canada, the US and Mexico through a series of reservoirs, canals, pipelines, tunnels and pumping stations.

Parsons Company’s 1964 plan stated: “Water is now our number one continental problem and must be solved on a continental scale.” NAWAPA would “take advantage of the geography and climatology of the North American Continent, utilizing the excess water of the high yield watersheds of the far northwestern land masses by distributing it to the water deficient areas of Canada, the United States, and northern Mexico in sufficient quantities to assure water supplies [for] the next one hundred years or more.”

NAWAPA’s goal: the annual delivery of 158 million acre-feet of freshwater to (in Tillerson’s words) “the right places.”

Watershed Sentinel’s clippings archive reveals that interest in NAWAPA has re-emerged almost every dozen years or so, usually coinciding with US periods of drought. But this time, critics are warning that many of the reservoirs, canals, pipelines, etc., are already in place, having been built incrementally since the 1950s.

Holm told me by email that Site C “will enable water transfers east of the Rockies,” across Alberta and the Prairies, and south through the Great Plains states to Texas and the southwest.

A 2015 report published by the University of Calgary School for Public Policy noted that the “NAWAPA project would feed the headwaters of the Colorado River, a major source of water for the … southwestern United States, and stabilize the Ogallala Aquifer, a major source of water for farmers in the Great Plains.” The School for Public Policy is funded by ExxonMobil subsidiary Imperial Oil.

Holm also states that “with NAFTA in place, we have lost our sovereign rights to stop these sorts of things.”

NAFTA

One of NAWAPA’s early promoters was Canadian financier Simon Reisman, who negotiated the 1988 Canada-US Free Trade Agreement (FTA) during the reign of PM Brian Mulroney, himself an advocate of bulk water export. That agreement was the predecessor to the North American Free Trade Agreement (NAFTA), signed by PM Jean Chretien and in effect since 1994.

Site C may provide energy and water for fracking and tar sands mining in the medium term, but in the long term “the end game” of Site C is bulk water export because that water “will have a far higher value” than oil and gas.

Wendy Holm says that NAFTA “got rid of the messy sovereignty issues” around water. As she told me by email, “With respect to transboundary movement of water, there are no real ‘decisions’ to be made. That ship has sailed. All water other than ‘natural waters’ (free flowing lakes and rivers) come under NAFTA.” Presumably this means reservoirs and aquifers. So if Canada tried to stop bulk water export, it would be subject to an investor-state dispute settlement (ISDS) lawsuit. “We can pass any legislation we want,” Holm told me, “but if it violates NAFTA rights, it can be challenged” in the private arbitration courts.

Site C may provide energy and water for fracking and tar sands mining in the medium term, but in the long term Holm says that “the end game” of Site C is bulk water export because that water “will have a far higher value” than oil and gas.

According to the Council of Canadians, “In 1999, the federal and provincial governments entered into a voluntary agreement banning bulk water exports. But any province that chose to lift that voluntary ban and approve bulk water exports would put pressure on every other province” because the ISDS provision “could be used by a company denied permission to export water from any other province.”

On January 23, 2017, a Council of Canadians blog post noted, “The Frontier Centre for Public Policy has estimated that Manitoba could make $1.33 billion a year by exporting one per cent of the fresh water that flows into Hudson Bay via a pipeline to American markets.”

Water Permits

In 2001, Holm warned about Bill C-6, An Act to Amend the Boundary Waters Act, which “purports to ban exports ‘except where permitted’ and vests water export-licensing authority with the Minister of International Affairs,” (now called Minister of Foreign Affairs). C-6 was given Royal Assent in December 2001.

I asked Holm if C-6 is still in force, but she wasn’t sure. So I asked Maude Barlow, who told me by email that C-6 was supposedly “superceded” by 2012 legislation, but she didn’t agree. She referred me to her new book Boiling Point, which discusses Bill C-383, the Transboundary Waters Protection Act of 2012.

Far from protecting Canada’s water, C-383 contains “constitutional and trade-related flaws” that leave Canada open to NAFTA challenges. As the Council of Canadians recently noted, C-383 “does not protect non-boundary waters [and] allows bulk removals of 50,000 litres of water per day.”

Still unsure about the status of C-6, I asked public interest lawyer Steven Shrybman, who responded by email that unless the law has been rescinded, it is still the law.

So I checked openparliament.ca, which says of C-6, “Status: This bill has received Royal Assent and is now law.”Apparently then, Canada’s Minister of Foreign Affairs has water export-licensing authority and can issue permits for export.

In January 2017, Chrystia Freeland was promoted to be Canada’s Minister of Foreign Affairs, replacing Stephane Dion. During the 2015 federal election campaign, Dion voiced strong opposition to bulk water exports. Freeland, however, took no such stance. Her new portfolio duties include the NAFTA file, which President Trump wants to re-negotiate or discard.

Both Wendy Holm and Maude Barlow are urging that water “as a good, service, or investment” be removed from NAFTA and the FTA.

In 2014, Dentons, the world’s biggest law and lobbying firm, advised its clients that “over the next 15 years” demand for fresh water will increase globally “by 40 percent.” One of Dentons’ corporate clients is pipeline giant Enbridge.

The Council of Canadians state that “water, energy proportionality and the investor-state clause” should be excised from the continental deals. Energy proportionality requires countries to export the same proportion of total energy supply that it has done over the previous three years. Its aim was to ensure unlimited US access to Canadian energy resources: Mexico refused the clause and got an exemption. The investor-state clause gives foreign corporations the right to sue Canadian governments for passing laws that hurt their profits.

Holm warns that with Site C, if BC Hydro is privatized, the bulk water export decision “will be in investors’ hands.”

Investors’ Hands

For two days in January 2017, the Trudeau Liberal Cabinet huddled to discuss Trump’s administrative appointments and his call for NAFTA to be re-negotiated.

Freeland had already been making the rounds in Washington as trade minister, meeting with Trump advisor Newt Gingrich, who is with Dentons, the world’s biggest law and lobbying firm. There he is joined by other powerhouse advisors, including Jean Chretien, Gary Doer (former Manitoba premier and former Canadian ambassador to the US), James Moore (former Canadian Industry minister), Stephen Harper, and Gordon Giffin (former US ambassador to Canada and long-time director of Canadian Natural Resources Ltd.) Dentons has close ties to Donald Trump.

In 2014, Dentons advised its clients that “over the next 15 years” demand for fresh water will increase globally “by 40 percent.” One of Dentons’ corporate clients is pipeline giant Enbridge, whom Dentons lawyers defended in the recent Supreme Court challenge to Line 9 by the Chippewas of the Thames in Ontario.

As trade minister, Freeland had also already met with Stephen Schwarzman, the CEO of the Blackstone Group investment firm, where Brian Mulroney has been a director since 2007. In 2014, the Blackstone Group launched something called Global Water Development Partners to “identify, develop, finance, construct and operate large-scale independent water development projects.” Mulroney has been a liason between Trudeau and Trump since the November election.

In December 2016, Blackstone Group’s Stephen Schwarzman was appointed Chair of the President’s Strategic and Policy Forum – a group of business leaders (including Larry Fink of BlackRock – the world’s largest investment company) who are advising Trump. The Forum members include infrastructure heavyweights such as the chairman of Global Infrastructure Partners (formed by Credit Suisse and General Electric).

During the Trudeau cabinet huddle, discussions included McKinsey’s Dominic Barton (the head of Trudeau’s Council of Economic Advisers), and Blackstone Group’s Stephen Schwarzman.

Obviously, a very small circle of elites are drawing up the plans for NAFTA renegotiations and other cross-border issues.